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Dan's Blog

403(b) "How It Started 😫 How It Ended 😀" Stories

October 20, 2020

On September 23, a Twitter user shared before and after photos depicting the trajectory of a relationship. Images were captioned "How It Started" and "How It Ended." This set off a torrent of mostly fun imitations. It got me to thinking about all the good retirement plan status news we have been hearing from the 403bwise community. 

From the 403bwise Facebook Group

It's almost hard to keep up with all of the good news being shared by the 403bwise community. Here are a few of our favorites...

How It Started

(9/19/20) Does the CARES Act Escape Hatch provision apply to ROTH 403(b) accounts? I have a ROTH 403(b) with AXA. I would then pay it back into my Roth IRA that I have with Vanguard. I actually was tested positive with COVID (all better now, thankfully!) so I think this may applies to me. I'll have to check that it was a CDC approved test though. Thanks!

 

How It Ended

(10/10/20) My COVID Related Distribution came! So long AXA! How long should I sit on the money before paying back in my Vanguard? Do I need to let the government know I’ve paid it back?

How It Started

(7/28/20) Can you guys help me formulate an email to send to my school board asking for a lower cost option for our 403b's?  I'm literally composing this as we speak so if anyone can suggest something that would help!

 

How It Ended

(9/1/20) My school added Vanguard!! Praise the Lord!! Thank You! Thank You! to everyone for their help! It takes about 14 days for the school to process the info and then I should be able to set it up thereafter. I'm so excited I don't know what to do with myself.

How It Started

(10/17/20) Can anyone tell me how I can figure out what fees I am actually paying on my AXA Equitable 403b account? I am working on getting out of it. I tried looking through the prospectus and can't make heads or tails of it. It's *almost* like they don't want me to know what the fees are.

 

How It Ended

(Later on 10/17/20) The weighted-average expense of this product is somewhere between 1.90 - 2.07% depending on how we allocate the cost on their fixed account. Interestingly they have half your account in the S & P 500 Index, at a cost of 1.90%. This is 47x what Vanguard charges and 95x what Fidelity charges for the exact investment option. AXA also charges $25 per year if under $25,000 (Vanguard charges $60, Fidelity $24). Bottomline, it's an expensive product. At Fidelity, on a $25,000 account you'd pay a total of $29 for the year ($24 annual fee plus $5 for the S & P 500 index) at AXA, you'd pay about $500. You need to feel like you are getting at least $471 a year in value from the services provided by AXA in order to stay. BTW - this is not investment advice, only comparison. What other options do you have available?

Keep the retirement plan relationship status updates coming!

Stay wise. Stay well.